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Court rules against manager in spat with CEO

BY Ilana Pearlman

A store manager’s inability to be physically present at work during the busy season was a legitimate business reason for her termination, the 9th U.S. Circuit Court of Appeals ruled.

Cynthia Lawler had managed a Montblanc retail store in a mall for nearly a decade. The store made a third of its sales during the holiday season. Thus, from Thanksgiving to Jan. 2, Lawler was required to work 60 to 70 hours per week.

Due to her chronic arthritis, Lawler requested a 25-hour workweek. The company responded that the manager job required her full-time presence, and inquired about the nature and scope of her disability and any possible accommodations.

On Aug. 4, 2009, Lawler fell and fractured two toes on one foot. The next day, she drove to the store to use the fax machine to submit her doctor’s certification, which stated that Lawler needed to be off from work until Sept. 2, 2009. She contends that, at the store, she encountered Montblanc CEO Jan-Patrick Schmitz. Schmitz, who was on a routine visit, asked, in an “abrupt, brisk” manner, why Lawler was not professionally dressed. The store manager disclosed her disability status and said she would be leaving the store. In an “intimidating,” “abrupt” and “gruff” tone, Schmitz replied, “We will talk when I get back.” When he returned, he “stared” at her. Lawler claims that Schmitz became “very, very angry” when he noticed that new products were not displayed.

When Lawler tried to respond, Schmitz “got mad that [Lawler] was confronting him.” He also complained about how parts were being stored. The CEO instructed Lawler to give him a report on the racial backgrounds of store customers. When she reminded him that she was on disability leave, he replied, “You will do it or else.”

On Sept. 2, 2009, the day Lawler was scheduled to return to work, her doctor provided a letter recommending that she remain on leave until Jan. 5, 2010, because of her arthritis. In response to an HR inquiry about accommodations that could be provided to permit Lawler to return, the doctor reiterated the leave requirement.

On Oct. 14, 2009, Montblanc sent a termination letter to Lawler because, as she had been advised in July, the company needed a full-time manager in the store. In response, Lawler sued Montblanc for intentional infliction of emotional distress and for disability-related discriminatory termination, retaliation and harassment under the California Fair Employment and Housing Act (FEHA). The trial court dismissed her case on summary judgment, and the 9th U.S. Circuit Court of Appeals affirmed the ruling. The 9th Circuit encompasses California, Arizona, Oregon, Washington, Hawaii, Alaska, Idaho, Montana and Nevada. Appeals court decisions are the law only in the states within that circuit, but other circuit courts may look to their sister court decisions in similar cases.

Under California Law, two of the elements of a claim for intentional infliction of emotional distress are “outrageous” conduct that is so “extreme as to exceed all bounds of that usually tolerated in a civilized society” and emotional distress that is so “severe” that “no reasonable person in civilized society should be expected to endure it.”

First, Schmitz’s “gruff,” “abrupt” and “intimidating” conduct did not meet this test, as the law does not protect employees from impolite communication of dissatisfaction with their work performance. Second, Lawler’s claimed emotional injuries of “anxiety, sleeplessness, upset stomach and sometimes muscle twitches” were not sufficiently “severe” as a matter of law.

Further, to establish a discriminatory disability termination claim under FEHA, an employee must demonstrate that she was able to perform the essential job functions, with or without accommodation. Here, Lawler admitted that her duties could be performed only in the store, and she did not provide any evidence that she could perform any of her responsibilities, regardless of the accommodation.

As to the retaliation claim, once an employee has made an initial factual showing, the defendant employer can rebut the showing with proof of a “legitimate business reason” for the termination. Montblanc’s stated business reason for terminating Lawler — her absence from work — met this test. In this case the company did a third of its annual business during the period in which Lawler could not perform her duties. The fact that the company knew that Lawler’s absences were disability related did not change this analysis.

Finally, to establish a harassment claim under FEHA, the employee must show a concerted pattern of harassment. Unlike discrimination, harassment consists of actions outside the scope of job duties. However, here, all of Schmitz’s actions were related to business operations and Lawler’s position as a manager. Even if the actions had been unrelated to business, this single occasion of “gruff,” “abrupt” and “intimidating” speech was not severe enough to constitute a hostile work environment.

Accordingly, the court of appeals affirmed the trial court’s dismissal of all of Lawler’s claims.

Lawler v. Montblanc North America LLC, 9th Cir., No. 1-16206 (Jan. 11, 2013).

Ilana Pearlman is an attorney with Foster Employment Law, the Worklaw® Network member firm in Oakland, Calif.

Have HR-related questions and concerns? Get access to essential forms, policies and guides, plus a live call center, at ToolkitHR.com, powered by HCN and the Society for Human Resource Management (SHRM).

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Market Recap: RISI Crow’s Construction Materials Cost Index

BY HBSDEALER Staff

A price index of lumber and panels used in actual construction for Feb. 15, 2013

*Western – regional species perimeter foundation; Southern – regional species slab construction.

Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.

Lumber: SPF trading was moderate and steady, which led to higher prices for the second consecutive week. Volumes sold were not near those sold the week prior. The need to purchase again outweighed caution generated by high prices. Sales in the Southern Pine lumber market slowed compared to trading the prior week, when buyers purchased much of the market’s February supply. Order files extending two to four weeks and sometimes longer and enough sales activity to sell another week of production prompted higher prices. Coastal species lumber continued to sell from mills at a strong pace, and secondaries moved their wood through the system steadily. Higher prices prompted some pushback from buyers, but the need to purchase often took a backseat to any protestations. Strength and control of the Inland species lumber market remained in the hands of producers. Limited on hand inventories and order files as far out as mid-March, along with continued buyer interest, allowed mill prices to increase. Offerings of Radiata Pine were light for Mldg&Btr and practically non-existent for Shop grades, as producers were able to garner better returns in markets outside North America. Ponderosa Pine producers reported modest inquiry and sales, as buyers stepped in to cover some of their needs. Supplies of Ponderosa Pine boards remained thin and producers priced defensively. Eastern White Pine reported business was back to normal after the big snowstorm. They reported steady sales and firm pricing. Industrial was difficult to find. Western Red Cedar mills continued to ship orders to customers placed back in late 2012 and took new orders for shipment as far out as June. A fair amount of inquiry for quicker shipping product circled the market, although producers had little to offer.

Panels: The OSB market in all regions continued to strengthen. Mill order files into late March, or even early April, were reported. Buyers turned to secondaries with contract wood to cover much of their immediate needs. Steady sales sent Southern Pine plywood prices higher. Wholesalers purchased moderate volumes with lead times out into mid March after selling near replacement costs. Yards continued to purchase at a steady pace. The sales pace in the Western Fir plywood market slowed considerably. Order files extended into early March, but spotty volumes of various items were still available for the week of Feb. 25 and as early as Feb. 18. The volume of sales in Canadian plywood was light. Buyers who had made earlier purchases stayed on the sidelines. However, distributers reported good product flow from their yards. Aside from the spotty surge in sales occurring at a few mills, particleboard demand remained on par with previous weeks this year. In MDF, recent price increases have taken hold, establishing new market price levels.

For more on RISI, click here.

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Home builder confidence slips slightly in February

BY Ken Clark

Hovering in the same three-point range during the past four months, the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) slipped a point in February.

The measure of builder confidence declined from 47 in January to 46 in February, according to the data released Tuesday morning.

“This is partly due to ongoing uncertainties about job growth and consumer access to mortgage credit, but it’s also a reflection of the fact that builders are now confronting rising costs for building materials and, in some markets, limited availability of labor and lots as demand for new homes strengthens,” said NAHB chairman Rick Judson, a home builder from Charlotte, N.C.

The decline in the index marked the first slip since April.

Three-month moving averages for each region’s HMI score were mixed in February, with the Northeast up three points to 39; the West up four points to 55; and the Midwest and South each down two points, to 48 and 47, respectively.

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